Custom Beta Six Months Formula in Excel

The Custom Beta Six Months formula in Excel (with MarketXLS) helps you measure how volatile or sensitive a stock (or other financial instrument) is compared to a benchmark index over a recent six-month period. By leveraging daily (or weekly/monthly) closing prices, it provides a quick way to assess correlation and risk relative to the market.

Understanding Custom Beta Six Months

• Purpose and Use Cases
  The beta value is a standard measure of volatility. A higher beta means the stock is more volatile than the benchmark, while a lower beta implies less volatility.
• Key Benefits
  • Quickly gauge a stock’s risk compared to the market over the past six months.
  • Ideal for short- to mid-term portfolio adjustments and risk analysis.
• When to Use
  Use this formula when you need to evaluate how a particular stock tracks market movements in the recent half-year timeframe.

Syntax and Parameters

=CustomBetaSixMonths(symbol, [benchmark], [frequency])

?? Note: If you enter an invalid symbol or if your MarketXLS license is not valid, the formula returns "NA".

Return Value:
A numeric result indicating the six-month beta of the specified symbol against the benchmark. A value of 1.0 suggests the stock moves in tandem with the market; values above 1.0 indicate higher volatility, while values below 1.0 indicate lower volatility.

? Pro Tip: The Custom Beta Six Months formula fetches data from the MarketXLS API. Heavy usage with multiple symbols can impact performance in Excel.

Examples and Usage

Below are some practical ways to use CustomBetaSixMonths in Excel:

• Basic Example

  =CustomBetaSixMonths("MSFT")

  This calculates the six-month beta of Microsoft (MSFT) against the default benchmark (SPY) on a daily basis.

• Changing the Benchmark

  =CustomBetaSixMonths("MSFT", "AAPL")

  This calculates the six-month beta of Microsoft relative to Apple (AAPL) on a daily basis.

• Specifying Different Frequencies

  =CustomBetaSixMonths("MSFT", "AAPL", "monthly")
  =CustomBetaSixMonths("MSFT", "AAPL", "weekly")

  These examples compute monthly or weekly beta values over the same six-month window.

?? Note: There are no direct date parameters. The function automatically uses the last six months of historical data up to the prior trading day.

Common Questions

1. What happens if I use an invalid symbol?
   • The formula returns "NA". Ensure you input correct symbols like "MSFT", "^SPX", or "BTCUSD:DEFAULT".

2. How does the function handle missing data?
   • If there is insufficient data for the specified period, the result may be inaccurate or return "NA".

3. Can I change the dates for the calculation?
   • Not directly. This function is specifically designed for a rolling six-month period. For custom date ranges, consider a different MarketXLS function that supports specifying start and end dates.

4. Does frequency affect performance?
   • daily frequency requires more data points, which can slow down performance. Consider weekly or monthly if speed is essential.

5. What if my MarketXLS license is expired or invalid?
   • The formula will return "NA" or a license error message. Ensure you have a valid license for full functionality.

• Related Functions
  • Total Dividends Paid Between Two Days In The Past: Summarizes dividends over a specified date range.
  • Stock Return Seven Days: Checks the stock performance over a one-week window.
  • Stock Return Fifteen Days: Focuses on a 15-day return percentage.
  • Stock Return Thirty Days: Retrieves a 30-day return value based on closing prices.